The Emergence of a Mobile Workforce and Key Considerations for Companies with Extended Business Travelers

August 2019

Staffing trends over the past decade have continued to show a decline in the number of traditional long-term assignments and an increasing shift towards shorter-term movements of employees. The emergence of a mobile workforce has generated new challenges when it comes to handling tax compliance for employees working across domestic and international borders.


Business Travelers

Business travelers are employees who travel to work in another U.S. state or in another country. These trips typically last from a few days to under 12 months, and can create tax and compliance challenges for companies.

A survey from Weichert Workforce Mobility asked companies about the challenges of managing extended business travelers. Of the 100 companies surveyed, 86 percent said that their biggest challenge in administering extended business travelers was assuring compliance with tax rules, and 92 percent of companies were concerned with the level of risk associated with non-compliance.


Compliance Challenges

When sending employees across borders, employers may be required to register with the tax authority and withhold income tax on employee wages earned in the state or foreign country. The employee may also be required to file a tax return in the jurisdiction(s) where he or she works.

If overlooked, these challenges can have high risk and costs. Companies with cross-border employee assignments should have global mobility policies and procedures in place to track business travelers and the potential compliance implications, such as approaching tax or immigration thresholds.

Listen as BDO’s Mesa Hodson discusses:
 



The Role of Automation in Mobile Workforce Management

One way to manage these complexities is to turn to automation. Automated tools can track employee movements and alert companies when a tax or immigration threshold is approaching, as well as allow employers to proactively plan for the potential implications related to each employee assignment.

BDO QuickTrip is a program used by employers to assess and control both risk and tax costs related to their mobile workforce. When used as part of a strategic approach to designing a business traveler program, BDO QuickTrip can help reduce tax compliance and reporting risk.

Learn more about BDO QuickTrip and BDO’s Global Expatriate Services practice.